A Big Day of Deals in the Gold Sector
Two mergers announced ahead of the Mining Forum Americas 2025
Consolidation in the gold sector continues at pace with two more deals announced in the past 24 hours.
Late on Thursday, Elemental Altus Royalties Corp (TSXV: ELE) and EMX Royalty Corporation (NYSE American: EMX) announced a merger to create a new mid-tier royalty company, continuing the string of deals in the space.
The scrip transaction implies a total equity value for EMX of US$456 million.
The merged company, which will be named Elemental Royalty Corp, will have 16 producing royalties, underpinned by four cornerstone royalties over the Timok, Karlawinda, Caserones and Laverton assets.
On Tuesday, Elemental paid A$80 million to expand its Laverton royalties and also acquired a royalty over the Dugbe development project in Liberia for up to US$20 million.
The enlarged entity will have a pro-forma market capitalisation of US$930 million and forecast revenue of US$70 million this year and US$80 million in 2026.
The Vancouver-based company will be run by Elemental executive chairman Juan Sartori, who will continue in that role, while EMX CEO David Cole will become CEO of the enlarged Elemental and current CEO Frederick Bell will become president and chief operating officer.
Tether backing
In June, Tether Investments, the world’s biggest stablecoin company, invested more than C$120 million in Elemental to become its largest shareholder with 33.7% of the company.
“Our investment in Elemental complements our long-standing belief that tangible assets like Bitcoin and gold will underpin the most durable forms of digital value,” Tether CEO Paolo Ardoino said at the time.
Earlier this week, Elemental said it had agreed to open an institutional account to gain access to Tether Gold (XAUt), a tokenised asset backed 1:1 by physical gold, which offers instant settlement, 24/7 liquidity, and no custody fees.
As part of the EMX transaction, Tether has agreed to invest US$100 million in Elemental.
Tether is expected to own 27% of the enlarged Elemental.
Separately, on Friday, the Financial Times reported that Tether had held talks with mining and investment groups about investing in the entire gold supply chain, citing people familiar with the discussions.
The company already owns US$8.7 billion worth of gold held in Swiss vaults.
Canadian combo
On Friday morning, US time, New Found Gold Corp (TSXV: NFG) announced that it had entered into a merger agreement with Maritime Resources Corp (TSXV: MAE).
Maritime shareholders will receive 0.75 of a New Found share for each existing Maritime Share held, which implies a premium of 32%, based on the 20-day volume-weighted average price of Maritime shares.
The deal, which values Maritime at C$292 million, is backed by Maritime’s directors, Dundee Resources, Eric Sprott and SCP Resource Partners, representing around 49% of the company.
New Found’s Queensway gold project and Maritime’s Hammerdown gold project are both in Newfoundland, 180km apart.
Hammerdown is anticipated to ramp up to full production in early 2026, forecast at 50,000 ounces per annum of gold at an all-in sustaining cost of US$912 an ounce.
The enlarged New Gold said cashflow from Hammerdown would support the development of Queensway, which is targeting first production in 2027.
The first phase of Queensway has capital costs of C$155 million to produce 69,300ozpa over four years at AISC of US$1282/oz, which will fund the second C$442 million phase to expand production to 172,200ozpa at AISC of US$1090/oz.
New Found said it would benefit from Maritime’s infrastructure, which includes the Pine Cove mill and Nugget Pond hydrometallurgical plant.
The transaction is expected to close in the December quarter.